December 7, 2015

Is The Fed Finally Being Forced To Consider Main Street?

To help Main Street, the Fed simply needs to stop incentivizing speculation over investment and end policies that have shifted wealth and income to the top of the wealth pyramid.

If there is anything about Federal Reserve policy that is now widely accepted as self-evident, it is that Fed policies have further enriched the super-rich and vastly widened wealth inequality. That this is now mainstream is remarkable, for it completely blows apart the Fed's PR claims to be "serving the people" by boosting inflation and making it easy for the super-wealthy to borrow unlimited sums of new money at near-zero rates.

You can't it both ways: you can't weaken your currency to boost exports and retain a global reserve currency.

But the Fed is also in another lose-lose conflict: the public-relations fight for its political legitimacy. Though it generated very little news flow, you can be sure Fed insiders saw the writing on the wall when the House of Representatives approved a measure to audit the Fed--in essence, a move to bring the Fed to heel.